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Status of the Stimulus: Fuzzy Math, Wasteful Spending – and Unemployment Still Rising
Late last week, the Obama Administration revealed troves of data about its nearly trillion dollar government spending spree, which it continues to describe as an economic stimulus package. Unfortunately for struggling American families and small businesses, the massive spending program simply hasn’t lived up to its “economic stimulus” moniker – leaving the American people to ask: “Where are the Jobs?”
It started last week when the Associated Press found the Administration significantly exaggerated early reports on the number of jobs created or saved because of the $787 billion in government spending.
“The government's first accounting of jobs tied to the $787 billion stimulus program claimed more than 30,000 positions paid for with recovery money. But that figure is overstated by least 5,000 jobs, according to an Associated Press review of a sample of stimulus contracts.
“The AP review found some counts were more than 10 times as high as the actual number of jobs; some jobs credited to the stimulus program were counted two and sometimes more than four times; and other jobs were credited to stimulus spending when none was produced.”
Blackledge and Apuzzo, “Stimulus jobs overstated by thousands,” The Associated Press, 10.29.09
The White House pledged to correct the errors immediately, but new reports out this morning confirm that serious distortions remain among the much-heralded claims of job creation. The Wall Street Journal reports on how some education jobs have been misreported and misrepresented.
“The number of jobs the Obama administration credits to federal stimulus money could be overstated by at least 20,000 of the 640,000 claimed, a Wall Street Journal analysis found. …
“Some Head Start preschool programs reported that stimulus money saved the job of every staff member who received a cost-of-living pay raise, according to their filings. Some colleges and universities counted every part-time student work-study position as a full-time job, according to their reports, which are published online at recovery.gov. …
“‘Holy moly, that's not right,’ Teresa Cox, executive director of the Mid-Willamette Valley Community Action Agency in Salem, Ore., said of her organization's report. It indicated that 205 jobs were created or saved with the agency's $397,761 federal grant. The money, she said, was used for pay raises.”
Radnofsky and Tamman, “White House Tally Appears to Overstate Stimulus Jobs,” The Wall Street Journal, 11.04.09
Funny numbers aren’t the only problem with so-called stimulus funding. Serious questions remain about how some of the money is actually being spent.
In early September, the Senior Republican on the House Education and Labor Committee, Rep. John Kline (R-MN), wrote to Secretary of Health and Human Services Kathleen Sebelius to raise concerns about media accounts that welfare funding designed to help pay for back-to-school expenses had been spent on alcohol and cigarettes:
“I am writing to express my strong concern regarding recent news reports that have detailed the improper use of TANF (Temporary Assistance for Needy Families) funds received under the American Recovery and Reinvestment Act (ARRA) by the state of New York.
“As you know, on August 10, the Governor of New York announced that the state would use $140 million in TANF funds received under ARRA to give $200 per child for school supplies to welfare and food stamp recipients with children between the ages of 3 and 17. However, the money was inexplicably distributed to recipients with no specific requirement that it be spent on school supplies beyond a verbal directive. It is my understanding that a number of recipients told reporters that they spent they money on cigarettes, haircuts, alcohol, and other activities that have no correlation to preparing children to go to school.”
Secretary Sebelius’ response? Apparently spending economic stimulus dollars on cigarettes, haircuts, and alcohol is “entirely consistent” with the law:
“New York opted not to impose specific spending restrictions on how families spent the funds. Under the statute, New York’s use of these funds was a lawful state choice, and is entirely consistent with ARRA and TANF legislation for this category of benefits.”
The Washington Examiner detailed other questionable spending in an article yesterday.
“The $787 billion stimulus bill was passed in February and was promised as a job saver and economy booster. Here is where some of the money went:
- $300,000 for a GPS-equipped helicopter to hunt for radioactive rabbit droppings at the Hanford nuclear reservation in Washington state.
- $30 million for a spring training baseball complex for the Arizona Diamondbacks and Colorado Rockies.
- $800,000 for the John Murtha Airport in Johnstown, Pa., serving about 20 passengers per day, to build a backup runway.
- $219,000 for Syracuse University to study the sex lives of freshmen women.
- $2.5 million in stimulus checks sent to the deceased.
- $300 apiece for thousands of signs at road construction sites across the country announcing that the projects are funded by stimulus money.
Ferrechio, “After a flurry of stimulus spending, questionable projects pile up,” Washington Examiner, 11.03.09
And what about those three million jobs that were supposed to have been “saved or created” by the stimulus?
The national unemployment rate currently stands at 9.8 percent, and approximately three million jobs have been lost since the so-called stimulus was enacted.
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